Invinity Energy Sys - Trading Update
Announcement provided by
Invinity Energy Systems plc · IES06/09/2024 07:01
The information contained within this Announcement is deemed by Invinity Energy Systems plc to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of
6 September 2024
Invinity Energy Systems plc
("Invinity" or the "Company")
Trading Update
Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF), a leading global manufacturer of utility-grade energy storage, provides an update on current trading and strategy.
Commercial Positioning
The market for Long Duration Energy Storage ("LDES") continues to develop favourably for the Company as alternative battery technologies and domestic supply chains become an increasing priority for decision makers in the
The Company's VS3 products have now been in service for a year or more at a number of customer sites, demonstrating that Invinity's batteries can generate customer returns across diverse geographies and applications by addressing one or many revenue streams. This achievement has supported growing acceptance of Invinity's technology as the leading proven alternative to lithium-ion batteries, and despite disappointing delays in closing sales in the year to date, customer interest in Invinity's products remains strong.
Furthermore, commercial operating data from these VS3 projects has also provided Invinity with valuable information on performance which has fed into the design process for the Company's next-generation product, code-named "Mistral".
As at 30 June 2024, the Company had cash reserves of
Next-Generation Product
The development of Mistral is progressing strongly and the production prototype has achieved its performance targets. Commercial launch, which will see Mistral become available for general sale by Invinity alongside the first pilot customer shipment, remains on schedule to occur by the end of the year.
Driving cost out of the Mistral manufacturing process and component supply chain is crucial to achieving targeted gross margins, and thus to supporting Invinity's fundamental corporate goal of reaching cashflow break-even and profitability. Such cost reduction is expected to come through a combination of continuous design improvements, supplier efficiencies and increased production volume.
Although Mistral has already demonstrated performance in-line with or ahead of expectations, the Board has decided that additional time is needed to complete the cost reduction exercise ahead of volume rollout, while maintaining a level of manufacturing sufficient to commence the drive to volume-based efficiencies. Accordingly, whilst this exercise completes, the Company believes a more cautious increase in Mistral deliveries during H1 2025 is prudent and will set the stage for further growth in volumes in H2 2025 before commencing full volume production in 2026 when the Company intends to achieve EBITDA break-even.
2024 Guidance
The Company previously advised that it expected 2024 revenue to be significantly second half weighted and in line with this guidance, expects H1 2024 revenues to be circa
Global market and policy developments, and the recent change of government in the
Invinity's commercial team is focused on concluding the LODES project and is in advanced tripartite discussions with a major international renewable energy project developer and the Department for Energy Security and Net Zero ("DESNZ") to finalise that project's structure and conclude contracts. The timing of the conclusion of such negotiations will have a material impact on whether associated revenues will be recognised in 2024 or 2025.
Whilst the delay in closing deals will have a significant impact on full year 2024 revenues, the Company's anticipated loss position is not expected to be materially different from its expectations.
Outlook
Including the UKIB investment for
Jonathan Marren, Chief Executive Officer at Invinity said:
"The development team, in collaboration with our joint development and commercialisation partner, have rightly focused on ensuring that Mistral is capable of delivering the performance characteristics being demanded by customers and the market; I am very pleased with the results to date. We aren't yet where we wanted to be on working through the identified initiatives aimed at reducing production costs to the level we believe we can attain but have confidence this can be achieved in 2025 ahead of material volumes at sustainable margins in 2026 and beyond.
We are very fortunate to have dedicated staff within Invinity who are committed to building Invinity to be a successful and profitable business and my role is to guide, support and enable them to use their skills for the benefit of all of our stakeholders. There are however areas which need to be addressed and which we can significantly improve on and my new role is to ensure we are laser focused on identifying solutions and implementing these improvements across a number of focus areas as soon as feasible.
- Commercial
o Renewed focus on commercial targeting, utilising a data driven approach
o Expand our use of partners to reach new customers outside our core markets to enable us to scale in a fast and cost-effective manner
- Operational
o Utilise our geographic centres of excellence in the
§ In the
§ In the
§ In
When we report our interims at the end of this month, I look forward to highlighting our progress in addressing these priorities."
Stay up to date with news from Invinity. Join the distribution list for the Company's monthly investor newsletter here.
Enquiries:
Invinity Energy Systems plc |
+44 (0)20 4551 0361 |
Jonathan Marren, Chief Executive Officer Joe Worthington, Director of Communications and Investor Relations |
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Canaccord Genuity (Nominated Adviser and Joint Broker) |
+44 (0)20 7523 8000 |
Henry Fitzgerald-O'Connor / Harry Pardoe / Charlie Hammond |
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VSA Capital (AQSE Corporate Advisor, Financial Adviser and Joint Broker) |
+44 (0)20 3005 5000 |
Andrew Monk / Andrew Raca |
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Tavistock (Financial PR Advisor) |
+44 (0)20 7920 3150 |
Simon Hudson / Saskia Sizen / Adam Baynes |
Notes to Editors
Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF) manufactures vanadium flow batteries for large-scale, high-throughput energy storage requirements of business, industry and electrical networks.
Invinity's factory-built flow batteries run continually with no degradation for over 25 years, making them suitable for the most demanding applications in renewable energy production. Energy storage systems based on Invinity's batteries are safe, reliable, and economical, and range in size from less than 250 kilowatt-hours to tens of megawatt-hours.
Invinity was created in April 2020 through the merger of two flow battery industry leaders: redT energy plc and Avalon Battery Corporation. With 75 MWh of systems already deployed or contracted for delivery across 82 sites in 15 countries, Invinity is active in all major global energy storage markets and has operations in the
To find out more, visit invinity.com, sign up to our monthly Investor Newsletter here or contact Investor Relations on via +44 (0)20 4551 0361 or ir@invinity.com.
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